How a cash flow will help your lawn mowing business.

What is cash flow?

A cash flow statement simply shows how much money is coming in and going out of your business. This is important to track because it will give you an idea of whether or not your business is profitable.

You can use this information to help you make decisions about running your business, such as whether or not you can afford to hire new employees or buy new equipment.

Why is having a cash flow important?

A cash flow will help your lawn mowing business because is helps track your finances and ensure your business runs smoothly. Knowing how much you have to spend on expenses such as inventory or payroll would be difficult without a cash flow.

One of the most important things I use cash flow for in my lawn mowing business is spotting lean times before they happen. If my cash flow total turns red and goes into the negative, I have the chance to play around with it and see what I can do before I get to that point.

How do I create a cash flow statement?

There are a few things that you will need to do to create a cash flow for your lawn mowing business:

• First, you will need to gather financial information for your business, such as income and bank statements.
• Next, you will need to create a spreadsheet or use accounting software to track your income and expenses.
• Finally, you must review your cash flow regularly to ensure your business is on track.

There are a few different ways to create a cash flow statement. You can use accounting software or create one manually using a spreadsheet program like Microsoft Excel.

 I write all my cash flows in Excel (or Google Sheets), and the formula is simple.

Here is one that I made for starting a lawn mowing business.

What information do I need to include in my cash flow statement?

There are a few things that you should include in your cash flow:

• Income: This should consist of all the money that comes into your business, such as revenue from sales and payments from customers.
• Expenses: This should include all the money going out of your business, such as the cost of goods sold and operating expenses.
• Cash balance: This is the difference between your income and expenses and will show you whether or not your business has enough money to cover its costs.

Once you have set this up, all you need to do is carry the balance forward, and you will have your finger on the pulse of your business. 

Also, remember to allow for seasonal fluctuations. Don’t use your monthly spring turnover every month; try to be slightly pessimistic with your predictions. It is better to underestimate than overestimate.

How often should I review my cash flow?

I know that when I first set up a cash flow for my business, I always played with it. I was running through all the scenarios I could think of just to see how they would turn out.

 This is OK when you start but don’t make a habit of it. Cashflows are a big-picture view, and daily management is not good in the long run. 

 You should review your cash flow monthly to ensure that your business is on track. If you notice any red flags, such as consistently high expenses or low income, then you may need to take action to improve your financial situation.

 Cash Flow Tips for Lawn Mowing Businesses

Here are a few tips to help you keep your business cash flow positive:

 Set up sound systems to get paid

Make sure that you are billing customers promptly and collecting payments promptly.

Send invoices immediately and chase up accounts as soon as they are overdue.

I know how easy it is to focus so much on getting the work done that you start running behind with the billing or collection of money owed.

This maximises the chances of success for your business. You need to focus on both earning and collecting money.

 Keep track of your spending.

Keep track of your expenses to know where every dollar is going. A cash flow chart is a lot like any other system. You need to put in good information to get good results.

 Keep all your receipts, and don’t take drawings from the business account more than once a week. Do not use the account like a cash card. Not only would that make keeping track harder, but it would also cost you more to get someone to get your bills in order at the end of the year.

So now you know how a cash flow will help your lawn mowing business.

Congratulations on making it to the end of our cash flow series! We hope you’ve learned a lot and are feeling excited to put what you’ve learned into action.

 Now that you know how to create a cash flow statement review it regularly so you can stay on top of your business finances.

 As always, we encourage you to join the lawnmowing101 community for more tips and advice from experts in the field. Thanks for reading, and happy mowing!